Two goals of the economic system should be to expand and spread global wealth, Blankfein, who turns 58 tomorrow, said in a discussion today with Royal Bank of Canada (RY) CEO Gordon Nixon at an event hosted by the Canadian Club of Toronto.
“Over the long term, if the system works well, it should accomplish both goals,” Blankfein said. “It hasn’t accomplished enough of the second goal in the right way, and that’s what the distress is over.”
Occupy Wall Street, the global movement against inequality that ignited in Manhattan last year, marked its first anniversary with demonstrations on Sept. 17. Protests against income disparity, bankers’ greed and corporate abuse sprouted from San Francisco to Hong Kong after demonstrators established an encampment in Manhattan’s Zuccotti Park a year ago.
“In the United States over the last generation or two we’ve been much better at generating wealth and much less good at distributing it,” Blankfein said.
Still, he said he doesn’t believe in wealth redistribution.
“No one’s going to accuse me of being a socialist, and I’m not,” Blankfein told the audience of about 860 business people.
Attention the financial industry and firms including Goldman Sachs have faced for their role behind the financial crisis has been “disproportionate” though not necessarily unfair, Blankfein said.
“For me, it’s distracting to say the least, but I don’t want to suggest that we’re repelling the notion of it because it’s unfair, it’s just disproportionate,” said Blankfein, whose firm awarded him $12.4 million in compensation for 2011.
Goldman Sachs, the most profitable securities firm in Wall Street history before converting to a bank in 2008, announced a new round of cost-cutting in July after reporting the lowest first-half revenue in seven years.
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